Here's How Ireland Got Into This Huge Mess With Anglo Irish Bank

Update: The Irish government has announced plans to split Anglo Irish Bank in two. Full details here >

We may only be a few hours away from an Irish government statement on Anglo Irish Bank that could decide the future of its position in the company.

It may not longer be worth it for Ireland to backstop the troubled bank as costs rise and impair the state's ability to escape economic recession.

But the story didn't start with Anglo Irish Bank. Ireland has gone through a housing bubble and credit boom, which resulted in a state bailout and now a bank that may be too big to bail for the tiny Irish state.

It All Started With A Massive Property Bubble

Ireland's property boom was at the heart of the Celtic Tiger phenomenon, and when it bust it brought much of the previous decade's economic growth with it, including several of the country's biggest banks.

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Dublin: Boom To Bust

Dublin saw itself fall from Dubai on the Liffey levels back to Earth as massive projects like the "U2 Tower" were canceled.

Bulldozing Vacant Homes

The Irish Austerity Budget

The Irish austerity budget made severe cuts to public services across Ireland in an effort to reduce the deficit as a percentage of GDP and increase confidence in Irish sovereign debt. Welfare payments were slashed 4.1% and the total budget was cut 8.8%.